Paytm Payments Bank offers free IMPS, NEFT, RTGS transactions

After its beta launch in May this year, digital payments company Paytm has launched its Paytm Payments Bank operations. 

The company, which aims to bring half-a-billion Indians into 'mainstream economy',  claims it to be the the country's largest mobile-first and technology-led bank. 

The accounts holders of Paytm Payments Bank will get the benefits like zero-balance account, free IMPS, NEFT, RTGS, UPI transactions and a complimentary virtual Rupay cards for online transactions.

Paytm Payments Bank account holders will also be able to earn an interest of 4 per cent on savings every month. The account holders will also be offered a free insurance cover of up to Rs 2 lakh in case of death or permanent disability according to the terms and conditions, Paytm said.

To facilitate verification of account holders, Paytm plans to invest $500 million in KYC (Know Your Customer) operations. It is setting up KYC centres across India to complete the KYC formalities for customers and make them eligible for a payments bank account.

The account holders of Paytm Payments Bank can also ask for a physical Rupay card, which will cost Rs 100 excluding delivery charges. PhyAccount holders will be able to view their transactions and balance in real time in Paytm Passbook.

Earlier, Paytm had tied up with private sector lender ICICI Bank to offer its customers up to Rs 20,000 interest free credit for the first time for everyday use ranging from movies to bill payments to flights and white goods. 

The amount would remain interest free for a period of 45 days. Thereafter, an interest of 3 per cent will be levied, it had said.

Paytm, which has high-profile investors like SoftBank and Alibaba, has drawn up a massive investment plan of Rs 20,000 crore as the group expands its play into the digital payments.

"In the last 2 years and the next three years, we would have invested Rs 18,000-20,000 crore. I don't want to talk about profitability right now because we are still in an investment phase," Paytm founder and CEO Vijay Shekhar Sharma told reporters in New Delhi on Tuesday.

Inaugurating the Paytm Payments Bank on Tuesday, Finance Minister Arun Jaitley said the modern technology had changed the entire dynamics the way banking was done in the country.